Judge: H. Jay Ford, III, Case: 24SMCV02567, Date: 2024-11-14 Tentative Ruling

Case Number: 24SMCV02567    Hearing Date: November 14, 2024    Dept: O

 Case Name:  Kousnetz v. McCaney, et al.

SUBJECT:                 DEMURRER WITH MOTION TO STRIKE

MOVING PARTY:   Defendant Jennifer McCaney

RESP. PARTY:         Plaintiff Savanah Kousnetz

TENTATIVE RULING

            Defendant Jennifer McCaney’s Demurrer to the 2^nd–5^th causes of action within Plaintiff Savanah Kousnetz’s Complaint is OVERRULED. The causes of action are not barred by the exclusive remedy of workers compensation at this stage of the litigation. Plaintiff has stated ultimate facts to successfully allege all the causes of action within the Complaint.

            Defendant Jennifer McCaney’s Motion to Strike is DENIED.

            Defendant’s RJN is DENIED. (See Gould v. Maryland Sound Indus., Inc. (1995) 31 Cal. App. 4th 1137, 1145, as modified (Feb. 9, 1995) [“[W]e hold the existence of a contract between private parties cannot be established by judicial notice under Evidence Code section 452, subdivision (h).”].)

REASONING

As a general matter, in a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice. (Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) “A demurrer tests the pleading alone, and not the evidence or facts alleged.” (E428.50Fab, Inc. v. Accountants, Inc. Servs. (2007) 153 Cal.App.4th 1308, 1315.) As such, the court assumes the truth of the complaint’s properly pleaded or implied factual allegations. (Id.) The only issue a demurrer is concerned with is whether the complaint, as it stands, states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.)

Where a demurrer is sustained, leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) The burden is on the plaintiff to show the court that a pleading can be amended successfully. (Id.; Lewis v. YouTube, LLC (2015) 244 Cal.App.4th 118, 226.) However, “[i]f there is any reasonable possibility that the plaintiff can state a good cause of action, it is error to sustain a demurrer without leave to amend.” (Youngman v. Nevada Irrigation Dist. (1969) 70 Cal.2d 240, 245.)

Plaintiff is only required to allege ultimate facts, not evidentiary facts. (See Committee on Children's Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 212 [“the complaint should set forth the ultimate facts constituting the cause of action, not the evidence by which plaintiff proposes to prove those facts”); 1 Cal. Affirmative Def. § 10:2 (2d ed.) [allegations of agency, course and scope of employment, etc. qualify as ultimate facts].) Plaintiff’s allegations must be accepted as true on demurrer. (See Yvanova v. New Century Mortgage Corp. (2016) 62 Cal.4th 919, 924 [“For purposes of reviewing a demurrer, we accept the truth of material facts properly pleaded in the operative complaint”].)

I.                Demurrer to 2^nd–5^th causes of action as barred by the exclusive remedy of workers compensation —OVERRULED

Defendant Jennifer McCaney (“McCaney”) demurs to the 2^nd-5^th causes of action arguing the causes of action are barred by the exclusive remedy of workers compensation. McCaney requests the Court to take judicial notice to the employment contract between McCaney and Plaintiff Savanah Kousnetz (“Kousnetz”) to show that Kousnetz was McCaney’s employee at the time of the subject incident, and not an independent contractor as alleged in the Complaint. (Demurrer, pp. 5–9; see Compl., ¶ 10.) McCaney references Labor Code § 3600(a) and 3602(a) to argue that these “statutes establish that a workers’ compensation claim is the exclusive remedy of an employee or a decedent employee’s heirs against an employer for an injury sustained in the course of the employment.” (Demurrer, p. 6:18–21; see Livitsanos v. Superior Court (1992) 2 Cal.4th 744, 754; Yau v. Allen (2014) 229 Cal.App.4th 144, 161.)  

Labor Code § 3600(a) states, “Liability for the compensation provided by this division, . . ., shall, without regard to negligence, exist against an employer for any injury sustained by his or her employees arising out of and in the course of employment.”  (Cal. Labor Code, § 3600 subd. (a).) Labor Code § 3602(a) states, “Where the conditions of compensation set forth in Section 3600 concur, the right to recover compensation is, except as specifically provided in this section and Sections 3706 and 4558, the sole and exclusive remedy of the employee or his or her dependents against the employer.” Cal. Labor Code § 3602, subd. (a).)

McCaney’s argument is without merit at the demurrer stage, as the Court cannot take judicial notice to a contract between the parties. (See Gould v. Maryland Sound Indus., Inc. (1995) 31 Cal. App. 4th 1137, 1145, as modified (Feb. 9, 1995) [“[W]e hold the existence of a contract between private parties cannot be established by judicial notice under Evidence Code section 452, subdivision (h).”]; Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 605 ["The hearing on demurrer may not be turned into a contested evidentiary hearing through the guise of having the court take judicial notice of affidavits, declarations, depositions, and other such material which was filed on behalf of the adverse party and which purports to contradict the allegations and contentions of the plaintiff."] The Court cannot take judicial notice to the fact that McCaney and Kousnetz contracted under an employment contract versus an independent contractor contract, thus the Court cannot make a ruling that as a matter of law an employment contract specifically existed between the parties to warrant the remedy be exclusively under workers compensation.

Additionally, all well plead allegations must be accepted as true at the pleadings stage, and Kousnetz pleads she was considered an independent contractor by alleging:

On June 6, 2022, the McCaney Family contracted with Plaintiff to provide the Children childcare services. At all times relevant herein, Plaintiff was classified, treated, and acted as an independent contractor. Plaintiff performed a substantial portion of her duties outside of the McCaney Family household and controlled the manner in which she provided services.

(Compl., ¶ 10.)

Thus, McCaney’s demurrer to the 2^nd-5^th causes of action as barred by the exclusive remedy of workers compensation is OVERRULED.

II.             McCaney’s Demurrer to the 2^nd cause of action for IIED—OVERRULED

The elements of a cause of action for intentional infliction of emotional distress are (1) outrageous conduct by the defendant, (2) intention to cause or reckless disregard of the probability of causing emotional distress, (3) severe emotional suffering, and (4) actual and proximate causation of the emotional distress. “Conduct is extreme and outrageous when it exceeds all bounds of decency usually tolerated by a decent society, and is of a nature which is especially calculated to cause, and does cause, mental distress. Liability does not extend to mere insults, indignities, threats, annoyances, petty oppressions, or other trivialities.” (Fisher v. San Pedro Peninsula Hospital (1989) 214 Cal.App.3d 590, 618.)

Kousnetz has alleged ultimate facts sufficient for an IIED claim, including outrageous conduct, intention to cause the emotional distress, severe emotional suffering, and causation. (Compl., ¶¶ 17–27, 35, 36, 37.) Kousnetz also alleges McCaney’s authorization and ratification of McCaney’s children, B.M. and W.M.’s, extreme and outrageous conduct. (Compl., ¶ 35.) Thus, McCaney’s demurrer to the IIED cause of action for not stating facts to allege the cause of action is OVERRULED.

III.           McCaney’s Demurrer to the 3^rd-5^th causes of action for failure to plead specific facts for fraud—OVERRULED

"A complaint for fraud must allege the following elements: (1) a knowingly false representation by the defendant; (2) an intent to deceive or induce reliance; (3) justifiable reliance by the plaintiff; and (4) resulting damages. Every element must be specifically pleaded. [citations omitted]" (Service by Medallion, Inc. v. Clorox Co. (1996) 44 Cal.App.4th 1807, 1816.)

“[T]he facts constituting the fraud must be alleged with sufficient specificity to allow defendant to understand fully the nature of the charge made.” (Roberts v. Ball, Hunt, Hart, Brown & Baerwitz (1976) 57 Cal.App.3d 104, 109.) Fraud actions against corporations require the plaintiff “to allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written.” (Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4th 153, 157.) However, the specificity requirement is “relaxed when the allegations indicate that the defendant must necessarily possess full information concerning the facts of the controversy or when the facts lie more in the knowledge of the opposite party.” (Ibid., citations omitted.)

McCaney conclusively argues that the 3^rd-5^th causes of action sounding in fraud do not comply with the strict pleading requirements for fraud claims, but fail to show specifically where the allegations are non-compliant. The Court finds finds the fraud allegations of the 3^rd–5^th causes of action are sufficient to comply with the strict pleading requirements of fraud.

Kousnetz specifically pleads misrepresentations by McCaney, and McCaney was aware of specific incidents of their children’s history of violent behavior. (Compl., ¶¶8, 19.) Kousnetz pleads McCaney intentionally withheld and misrepresented this information in order to hire and retain Kousnetz, and Kousnetz relied on the misrepresentations eventually resulting in injury. (Id., ¶¶ 10, 13–15, 20–22)

Thus, McCaney’s Demurrer to the 3^rd-5^th causes of action is OVERRULED.

IV.           McCaney’s Motion to Strike Punitive Damages—DENIED

McCaney argues that Plaintiff has failed to sufficiently plead punitive damages. The Court disagrees.

A plaintiff may recover punitive damages in an action for the breach of an obligation not arising out of contract where the defendant has been guilty of oppression, fraud, or malice. (Cal. Civ. Code §3294 (a).)

“(a) In an action for breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant had been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.” (Civ. Code, § 3294, subd. (a.)

“Malice is ‘conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.’ (Civ. Code, § 3294, subd. (c)(1).) Oppression is ‘despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person's rights.’ (Civ. Code, § 3294, subd. (c)(2).) Despicable conduct is conduct that is so vile, base, contemptible, miserable, wretched or loathsome that it would be looked down upon and despised by ordinary decent people. Such conduct has been described as having the character of outrage frequently associated with crime.” (Scott v. Phoenix Schools, Inc. (2009) 175 Cal.App.4th 702, 715.)

Here, Kousnetz alleges that McCaney made misrepresentations that the children’s behavioral issues were simply them “adjusting to her.” (Compl., at ¶ 11.) Kousnetz alleges that she later learned that the children have had a long history of violent behavior towards McCaney Family staff leading to injury. (Compl., at ¶ 19.) Kousnetz further alleges that the McCaney family intentionally withheld this information because Plaintiff and other potential childcare workers would refuse to work with the children. (Compl., ¶¶ 20–22.) Kousnetz essentially alleges that McCaney had actual and constructive notice of the possible harm the children posed to Kousnetz, but McCaney consciously disregarded it, which are sufficient allegations for pleading punitive damages.

            McCaney argues that Civ Code § 1714.1 precludes Plaintiff from pursuing punitive damages but this argument is without merit as well.

Civ Code § 1714.1 states:     

(a) Any act of willful misconduct of a minor that results in injury or death to another person or in any injury to the property of another shall be imputed to the parent or guardian having custody and control of the minor for all purposes of civil damages, and the parent or guardian having custody and control shall be jointly and severally liable with the minor for any damages resulting from the willful misconduct.

Subject to the provisions of subdivision (c), the joint and several liability of the parent or guardian having custody and control of a minor under this subdivision shall not exceed twenty-five thousand dollars ($25,000) for each tort of the minor, and in the case of injury to a person, imputed liability shall be further limited to medical, dental and hospital expenses incurred by the injured person, not to exceed twenty-five thousand dollars ($25,000).

(Civ. Code, § 1714.1.)

The statute only limits Kousnetz recovery from McCaney on behalf of B.M, for his negligence. Punitive damages are not alleged against B.M. for his negligence. However, nothing precludes Kousnetz from seeking punitive damages against McCaney for her own malicious conduct under Civ Code § 3294.. Plaintiff’s causes of action of IIED, Negligent Misrepresentation, Intentional Misrepresentation, and Negligent Failure to Warn, are separate and distinct from her cause of action for Negligence, and thus punitive damages may be alleged to McCaney for her actions alone.

Finally, McCaney argues Kousnetz cannot recover punitive damages because the claims are barred by the exclusive remedy of workers compensation, but as analyzed above, this argument is without merit at this stage. The Court cannot take judicial notice of the employment contract, nor the facts contained within the contract, and thus cannot make a determination as a matter of law regarding the specifics of the employment scenario between the parties.

McCaney’s Motion to Strike is DENIED.